B-153874, JUL. 17, 1964

B-153874: Jul 17, 1964

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KERRIGAN AND STILES: REFERENCE IS MADE TO YOUR LETTER OF APRIL 1. EXCEPT FOR THE FACT THAT IT "WAS NOT A REGULAR DEALER" IN SUCH ITEMS. HIS DETERMINATION WAS PREDICATED UPON FACTS REVEALED DURING A PRE-AWARD SURVEY AS FOLLOWS: "A. IS AN OFFICE LOCATED IN THE INTERNATIONAL TRADE MART IN NEW ORLEANS. BAGUR IS A SALES AGENT FOR A NUMBER OF MANUFACTURERS. ONE OF WHICH IS AEROVENT FAN COMPANY. BAGUR IS AN AUTHORIZED AGENT OF AEROVENT FAN COMPANY. THE BID WAS SUBMITTED IN HIS NAME AND NOT AS AN AGENT OF THAT COMPANY. OR EQUIPMENT ARE BOUGHT. AWARD OF THE CONTRACT WAS WITHHELD TO AFFORD YOU AS BAGUR'S ATTORNEYS AN OPPORTUNITY TO PRESENT THE MATTER TO OUR OFFICE. 000 IN AMOUNT ENTERED INTO BY ANY GOVERNMENT AGENCY FOR THE PROCUREMENT OF SUPPLIES SHALL CONTAIN A STIPULATION THAT THE CONTRACTOR IS A MANUFACTURER OF OR REGULAR DEALER IN SUCH SUPPLIES AND THAT ANY BREACH OF SUCH STIPULATION SHALL CONSTITUTE GROUNDS FOR CANCELLATION OF THE CONTRACT.

B-153874, JUL. 17, 1964

TO DEUTSCH, KERRIGAN AND STILES:

REFERENCE IS MADE TO YOUR LETTER OF APRIL 1, 1964, PROTESTING, ON BEHALF OF PIERRE E. BAGUR, JR. AND COMPANY, DISQUALIFICATION OF ITS BID UNDER INVITATION FOR BIDS NO. CIVENG-16-047-64-53 ISSUED OCTOBER 22, 1963, BY THE U.S. ARMY ENGINEER DISTRICT, NEW ORLEANS, LOUISIANA.

THE CONTRACTING OFFICER REPORTS THAT YOUR CLIENT, PIERRE E. BAGUR, JR. AND COMPANY, SUBMITTED THE LOWEST RESPONSIVE BID FOR THE VENTILATORS AND SPARE PARTS DESCRIBED IN THE INVITATION FOR BIDS, EXCEPT FOR THE FACT THAT IT "WAS NOT A REGULAR DEALER" IN SUCH ITEMS, AS REPRESENTED, IN ACCORDANCE WITH THE PROVISIONS OF THE WALSH-HEALEY ACT, 41 U.S.C. 35, APPLICABLE TO THE PROCUREMENT. HIS DETERMINATION WAS PREDICATED UPON FACTS REVEALED DURING A PRE-AWARD SURVEY AS FOLLOWS:

"A. THE PLACE OF BUSINESS OF PIERRE E. BAGUR, JR. AND CO., IS AN OFFICE LOCATED IN THE INTERNATIONAL TRADE MART IN NEW ORLEANS, LOUISIANA. THIS PLACE OF BUSINESS CONSISTS OF OFFICE SPACE FOR MR. BAGUR AND HIS SECRETARY.

"B. MR. BAGUR IS A SALES AGENT FOR A NUMBER OF MANUFACTURERS, ONE OF WHICH IS AEROVENT FAN COMPANY, PIQUA, OHIO, WHOSE PRODUCT HE PROPOSES TO FURNISH UNDER THIS INVITATION FOR BIDS.

"C. ALTHOUGH MR. BAGUR IS AN AUTHORIZED AGENT OF AEROVENT FAN COMPANY, INC., THE BID WAS SUBMITTED IN HIS NAME AND NOT AS AN AGENT OF THAT COMPANY. ASPR 12-603.4 REQUIRES THAT AGENTS SUBMIT BIDS IN THE NAME OF THEIR PRINCIPAL.

"D. MR. BAGUR DOES NOT OWN, OPERATE, OR MAINTAIN A STORE, WAREHOUSE, OR OTHER ESTABLISHMENT IN WHICH ANY MATERIAL, SUPPLIES, ARTICLES, OR EQUIPMENT ARE BOUGHT, KEPT IN STOCK, OR SOLD TO THE PUBLIC IN THE USUAL COURSE OF BUSINESS.'

AS A RESULT OF MR. BAGUR'S PROTEST ON DECEMBER 20, 1963, THE CONTRACTING OFFICER REFERRED THE MATTER TO THE DEPARTMENT OF LABOR, THROUGH THE CHIEF OF ENGINEERS, DEPARTMENT OF THE ARMY, FOR A FINAL DETERMINATION AS TO BAGUR'S ELIGIBILITY AS A REGULAR DEALER UNDER THE WALSH-HEALEY ACT. MARCH 16, 1964, THE ADMINISTRATOR, WAGE AND HOUR AND PUBLIC CONTRACTS DIVISIONS, DEPARTMENT OF LABOR, ADVISED THE CHIEF OF ENGINEERS THAT "THE DATA YOU FURNISHED * * * AND UPON WHICH YOUR CONTRACTING OFFICER MADE HIS FINDING, APPEAR TO SUPPORT HIS CONCLUSION.' AWARD OF THE CONTRACT WAS WITHHELD TO AFFORD YOU AS BAGUR'S ATTORNEYS AN OPPORTUNITY TO PRESENT THE MATTER TO OUR OFFICE.

THE WALSH-HEALEY ACT, 41 U.S.C. 35, PROVIDES THAT, WITH CERTAIN EXCEPTIONS NOT HERE MATERIAL, EVERY CONTRACT EXCEEDING $10,000 IN AMOUNT ENTERED INTO BY ANY GOVERNMENT AGENCY FOR THE PROCUREMENT OF SUPPLIES SHALL CONTAIN A STIPULATION THAT THE CONTRACTOR IS A MANUFACTURER OF OR REGULAR DEALER IN SUCH SUPPLIES AND THAT ANY BREACH OF SUCH STIPULATION SHALL CONSTITUTE GROUNDS FOR CANCELLATION OF THE CONTRACT. THE ACT, AS AMENDED, FURTHER PROVIDES (41 U.S.C. 38) THAT THE SECRETARY OF LABOR SHALL HAVE AUTHORITY TO ADMINISTER THE PROVISIONS OF THE ACT AND TO MAKE SUCH RULES AND REGULATIONS AS MAY BE NECESSARY TO THAT END. UNDER THAT AUTHORITY THE SECRETARY OF LABOR HAS ISSUED CERTAIN REGULATIONS APPEARING AT 41 CFR 50-201.101 (B) AND 50-201.104. THESE REGULATIONS HAVE BEEN SUPPLEMENTED BY PARAGRAPHS 12 601 TO 12-604, INCLUSIVE, OF THE ARMED SERVICES PROCUREMENT REGULATION.

UNDER THE FOREGOING REGULATIONS OUR OFFICE HAS NO AUTHORITY TO REVIEW DETERMINATIONS AS TO WHETHER PARTICULAR FIRMS ARE REGULAR DEALERS, AND SUCH DETERMINATIONS MUST BE MADE BY THE CONTRACTING OFFICER IN THE FIRST INSTANCE SUBJECT TO A FINAL DETERMINATION BY THE DEPARTMENT OF LABOR. UNDER ORDINARY CIRCUMSTANCES, WE MUST ACCEPT THE DETERMINATION OF THE SECRETARY OF LABOR AS FINAL IN THESE MATTERS.

YOU HAVE PRESENTED CERTAIN MATTERS IN YOUR LETTER OF APRIL 1 WHICH MAY NOT HAVE BEEN HERETOFORE CONSIDERED BY THE SECRETARY OF LABOR, OR HIS REPRESENTATIVE, IN AGREEING WITH THE CONTRACTING OFFICER THAT YOU WERE NOT A REGULAR DEALER FOR THE PURPOSE OF THE PROCUREMENT INVOLVED. SINCE WE ARE CONCERNED THAT EACH BIDDER ON GOVERNMENT PROCUREMENTS HAS HIS BID AND ELIGIBILITY FAIRLY AND COMPLETELY CONSIDERED SO THAT THE INTEGRITY OF THE COMPETITIVE BIDDING IS MAINTAINED, AND SINCE THE DETERMINATION OF THE ADMINISTRATOR, WAGE AND HOUR AND PUBLIC CONTRACTS DIVISIONS, MAY HAVE BEEN BASED ON LIMITED INFORMATION, YOU SHOULD PRESENT, ON BEHALF OF YOUR CLIENT, ALL OF THE PERTINENT INFORMATION TO THAT OFFICIAL AT THE EARLIEST PRACTICABLE DATE FOR RECONSIDERATION OF HIS DETERMINATION. AND YOU SHOULD ADVISE THE CONTRACTING OFFICER TO THIS EFFECT AT THE SAME TIME. IN THE ABSENCE OF SUCH FURTHER ACTION, WE MUST ACCEPT THE DETERMINATION OF THE CONTRACTING OFFICER THAT BAGUR DID NOT QUALIFY AS A REGULAR DEALER FOR PURPOSES OF AWARD.